Machinery of government changes can create severe cultural tensions within departments that can undermine staff morale and goodwill and adversely affect the mental health of employees, a researcher has found.

Forced mergers can also result in increased bullying and harassment, give rise to micro-cultures and spark ‘turf wars’, and even create future legal liabilities, says UNSW workplace culture expert Dr Anna Kiaos.

“Organisations, particularly government agencies who are supposed to be leading the way in this regard, need to understand that MoG mergers can cause psychological harm to employees,” she told Government News.

“Leaders must do their cultural homework in order to avoid legal ramifications down the track.”

Dr Kiaos, who specialises in ethnography, psychiatry and mental health, argues in a paper published in the current issue of the Australian Journal of Public Administration that the practise of creating and abolishing departments, or moving functions between agencies, often results in a ‘cultural misalignment’ that impacts not only business operations and customer service, but staff well-being.

Case study: DCS fail

The paper focuses on culture within Service NSW during and after its merger with the Department of Customer Service.

DCS was established in 2019 under Secretary Emma Hogan following an announcement by then ministers Victor Dominello and Kevin Anderson.

Dr Kiaos said the MoG represented immense cultural change and had a significant impact on Service NSW staff.

There were many unexpected results, she says, including the emergence of microcultures.

Essentially, Service NSW and its … culture was significantly destabilised as a result of the MoG merger with the DCS.

Dr Anna Kiaos

“Microcultures showed that Service NSW staff created mitigation strategies to avoid dealing with the Department of Customer Service (DCS),” she said.

Another surprising finding was just how limited DCS was in its abiltiy to manage the complexities of integration, she says.

“Sadly, this impacted many Service NSW employees, and some quite significantly concerning their mental health.

“Essentially, Service NSW and its … culture was significantly destabilised as a result of the MoG merger with the DCS.”

More MoGs in NSW

The publication of the research came as NSW last week announced fresh MoG changes which will see the Greater Cities Commission and the Western Parkland City Authority brought into DPE under the aegis of Acting Secretary Keirsten Fishburn, with the redeployment of more 350 staff from both agencies.

GCC Commissioners will continue to advise the planning minister on the Six Cities Region and  the WPCA Board will continue its work in relation to Bradfield City west of the CBD and the Western Parklands City.

Making the announcement last week, Premier Chris Minns said the changes would reduce duplication between the agencies and create a single clear line of responsibility for planning policy to help accelerate the delivery of more housing.

“The move puts the Department of Planning and Environment (DPE) in a much better position to focus on the job of overhauling the planning process and cutting red tape,” Mr Minns said last week.

MoGs not always a bad thing

MoGs aren’t always bad, Dr Kiaos says. They can cut costs, increase efficiencies, increase collaboration and idea generation, and widen the talent pool, as well as making it easier for staff to move fluidly into other roles.

However, it’s important for public sector leaders to be prepared to address arising cultural tensions.

“Culture needs to be analysed and understood at various levels before integration work begins,” she says.

“Without a blueprint of the culture per se, the integration of two cultures often goes pear shaped which is what happened when the DCS espoused their newly created culture.”

To mitigate the challenges arising from MoG changes, leaders need to act on the assumption that employees are experiencing tensions resulting from the organisation’s “disturbed social reality” even if they seem to think all is going well on the surface.

When employees are faced with forced change, and if that change isn’t well understood in terms of culture, and hence poorly managed, employers can face a range of legal issues

Dr Kiaos

Dr Kiaos also recommends hiring  an organisational ethnographer or anthropologist to assist prior to a merger, and establishing a Workplace Change Committee, with members who can act like ‘first responders’ across impacted departments and divisions.

“Workplace Change Committee Members manage emerging issues, specifically cultural disparities, to better ensure both the intra- and interpersonal safety of employees during times of forced cultural change,” she says.

Dr Kiaos notes that as of October last year employers are now responsible for preventing and managing psychosocial risks in their workplace.

“As evident in the study’s findings, some employees experienced a degree of intra and interpersonal tension, largely because there was inadequate knowledge about how to best integrate the two cultures at the outset along with the cultures of the other cluster agencies,” she says.

“When employees are faced with forced change, and if that change isn’t well understood in terms of culture, and hence poorly managed, employers can face a range of legal issues,” Dr Kiaos says.

Qld MoGs raise red flags for auditor

As reported by Government News, Queensland’s auditor general has also released a report raising concerns about the disruption caused by extensive machinery of government changes in his state.

Machinery of government changes following Queensland’s 2020 state election affected 17 departments and transferred more than 6,200 staff and $8.3 billion worth of assets.

Auditor general Brendan Worrall said he is concerned the government hasn’t properly grasped the initial and ongoing costs of departmental organisation.

“I am concerned that government is not clear on the benefits it aims to gain from such reorganisations,” he says in his report.